One of the most dangerous misperceptions among corporate clients is that disclosing privileged communications to such friendly outsiders as public relations consultants does not waive privilege protection as long as there is a confidentiality agreement in place. A steady stream of cases have rejected that approach, yet large corporate clients and sophisticated law firms continue to rely on that mistaken view.
In United States ex rel. Wollman v. Massachusetts General Hospital, Inc., Civ. A. No. 15-11890-ADB, 2020 U.S. Dist. LEXIS 134542 (D. Mass. July 29, 2020), Mass. General Hospital hired a former U.S. Attorney and his law firm Cooley, LLP, to investigate allegations that Mass. General fraudulently billed Medicare and Medicaid. The government sought the investigation report, and Mass. General predictably resisted. Unsurprisingly, Mass. General first claimed work product, but the court rejected that assertion: “there is no indication in the engagement letter, the Report itself, or the employee interviews that the Investigation was intended to relate to the [eventual litigation].” Id. at *28. The court then turned to Mass. General’s privilege claim – noting that Mass. General had disclosed the Report to public relations consultant Rasky “to assist in responding to an investigation by the [newspaper] Boston Globe Spotlight Team into the practice of overlapping surgeries.” Id. at *41. The court bluntly concluded that “the production of the Report to Rasky waived the attorney-client privilege.” Id. at *48. But the court found that because Mass. General and other defendants “have not sought to use the . . . Report in any fashion, much less to gain an adversarial advantage,” the waiver did not trigger a subject matter waiver. Id. at *51. The court explained that “[w]hile an argument can be made that they used the Report as a ‘sword and shield’ in their dealings with the press, the distinction between use in a judicial and nonjudicial setting is significant.” Id.
All of these conclusions follow generally accepted principles. It is remarkable that one of America’s great hospitals, a former U.S. Attorney, and a prestigious law firm would be involved in such a disclosure.
Published November 5, 2020.
